Englewood, Colorado-based internet service provider Verio Inc, launched its initial public offering on Tuesday, selling 5.5 million shares of common stock at $23.00 per share to raise $126.5m. That price hit the top company’s target of $22-$23, which was upped from $18-$20 on Monday ahead of the offering. The number of shares was also upped from an original total of 5 million. Verio seems to have taken advantage of the recent surge in internet stocks, with the shares closing at $27.0625 after trading as high as $30. The stock, which began trading on Tuesday under the ticker symbol VRIO, was the ninth most active issue with a total share volume of 5.8 million shares. All of the shares offered were being sold by the company, which plans to use the proceeds to continue making acquisitions and further develop its national backbone and customer support center, as well as for general working capital. Since 1996, Verio has acquired more than 30 local and regional ISPs as part of its strategy to consolidate the smaller companies under the Verio banner. It currently serves small-to-medium-sized businesses in 36 of the top 50 US markets and plans to eventually cover them all. The offering was managed by Salomon Smith Barney, Credit Suisse First Boston and Donaldson, Lufkin & Jenrette – which were granted a 30-day option to purchase up to an additional 825,000 shares to cover over- allotments. Concurrently with the IPO closing, Verio says it also expects to close a separate placement of 4.49 million shares of common stock with an affiliate of Japanese telecom giant Nippon Telegraph and Telephone Corporation (NTT) for an aggregate price of $100m, in exchange for a stake of up to 12.5% in Verio. The deal between the two was first announced in April (CI No 3,386) and NTT was to purchase the stock ahead of the IPO. In its original filing with The Securities and Exchange Commission, Verio showed revenue of $90m and about 80,000 customers.
